These example sentences are selected automatically from various online news sources to reflect current usage of the word 'loan.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

Origin and Etymology of loan

Middle English lon, from Old Norse lān; akin to Old English lǣn loan, lēon to lend, Latin linquere to leave, Greek leipein

loan

Definition of loan

transitive verb

loanable

loan vs. lend

The verb loan is one of the words English settlers brought to America and continued to use after it had died out in Britain. Its use was soon noticed by British visitors and somewhat later by the New England literati, who considered it a bit provincial. It was flatly declared wrong in 1870 by a popular commentator, who based his objection on etymology. A later scholar showed that the commentator was ignorant of Old English and thus unsound in his objection, but by then it was too late, as the condemnation had been picked up by many other commentators. Although a surprising number of critics still voice objections, loan is entirely standard as a verb. You should note that it is used only literally; lend is the verb used for figurative expressions, such as “lending a hand” or “lending enchantment.”

Examples of loan in a Sentence

The National Gallery has been kind enough to loan this painting to our museum.

His mother loaned him the money to buy a new car.

Can you loan me $20?

Recent Examples of loan from the Web

A contract actor under a 10-year agreement with Disney Studios, the 15-year-old had been loaned out that day, December 15, 1966.

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'loan.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

Near Antonyms

Other Economics Terms

Financial Definition of LOAN

loan

What It Is

In the business world, a loan is an amount borrowed.

How It Works

Let's assume Company XYZ has invented a new product that will revolutionize the widget market. The company is sure there will be demand from billions of people around the world, and therefore it needs to build a new factory. If Company XYZ's funds for constructing the factory were limited to its cash on hand, say $200,000, it certainly could not build the kind of factory it needs to capitalize on this tremendous opportunity and would thus be very limited in its output and profits (and would leave the market wide open for competitors to fill the void). With a loan, however, Company XYZ could build the factory and take advantage of the profit potential of its product. The debt essentially magnifies the profits.

In the business world, bank loans and corporate or government bonds are the most common. For individuals, loans can be personal loans, mortgages or lines of credit.

Why It Matters

A loan is a liability, meaning the lender has a claim on a company’s assets. Loan payments due within one year are generally classified as short-term debt on a company’s balance sheet. Loan payments due in more than one year are considered long-term debt. It is important to note that loans commonly come to mind when one considers liabilities, but not all liabilities are loans. Companies may incur other types of liabilities, including (but not limited to) upcoming payroll, bonuses, legal settlements, payments to vendors, certain derivatives, contracts, certain types of leases, and required stock redemptions. Common balance sheet categories for liabilities include accounts payable, accrued expenses, and debt.

Information about a company’s debt is a key component of accurate financial reporting and a crucial part of thorough financial analysis. Excessive debt can ruin a company but is not always detrimental. The use of debt financing can magnify profits that would have otherwise gone unrealized.

loan

Definition of loan for Students

loaned

loaning

: to give to another for temporary use with the understanding that the same or a like thing will be returned loan a bookloan money

Law Dictionary

loan

noun

Legal Definition of loan

1a: money lent at interest b: something lent usually for the borrower's temporary use

2: a transfer or delivery of money from one party to another with the express or implied agreement that the sum will be repaid regardless of contingency and usually with interest; broadly: the furnishing of something to another party for temporary use with the agreement that it or its equivalent will be returned the leasing of the car was termed a loanbridge loan: a short-term loan used as a means of financing a purchase or enterprise prior to obtaining other funds used a bridge loan to purchase a new home prior to the sale of the old oneconventional loan: a loan for the purchase of real property that is secured by a first mortgage on the property rather than by any federal agencydemand loan: a loan that is subject to repayment upon demand of the lenderhome equity loan: a loan or line of credit secured by the equity in one's home —called also equity loan, home equity line, home equity line of credit — see also qualified residence interest at interest 5loan for consumption\-kən-ˈsümp-shən\: a loan in which the borrower is obligated to return property of the same kind as that borrowed and consumed —used chiefly in the civil law of Louisiana; — compare bailmentdepositloan for use in this entryloan for use: a loan in which one party lends personal property to another with the understanding that the borrower will return the same property at a future time without compensation for its use :commodatum —used chiefly in the civil law of Louisiana; — compare bailmentdepositloan for consumption in this entryparticipation loan: a single loan in which two or more lenders participateterm loan: a loan extended to a business with provisions for repayment according to a schedule of amortization and usually for a period of one to five years and sometimes fifteen years